The outlook is bleak on unemployment

Press, 15 February 1982, Page 12

The outlook is bleak on unemployment

By

OLIVER RIDDELL

in Wellington

Apart from the statement of the Labour spokesman on employment, Mr. T. K. " Burke, accusing the.< Minister of Labour of “threatening students by flying kites,” the latest employment figures have provided unrelieved gloom, The figures, for the January jobless show a' 20 per cent rise on the levels of January, 1981, yet January is a time of high employment with seasonal labour opportunities greater, than at any other' time of the

year. The statistics are complicated because of the number of categories involved. In essence, there were 87,231 registered unemployed or on special work during January, of whom 50,773 were registered as unemployed. Both figures were well up on those for January and December, 1981.

Yet there is an element ofunreality about both the figures released by the xMinister of Labour. Mr Bolger, and the reaction of the Labour Opposition to them. This is not because the figures are unreal, or either side is unaware of what they mean in human and economic terms, but because both National and Labour are fresh from a General Election in which neither chose to make unemployment a key issue. National fought the 1981 General Election on its growth strategy, associated with which were a number of vote-catch-ing policies, such as permitting the Springbok Tour, the Supplementary Minimum Price payment to farmers, and others. Labour chose to fight National on the basis of its own growth strategy, which it called "think balanced” as against National’s “think big.” Both National and Labour expected their strategies to promote employment, and so they do. But by concentrating on growth strategies they chose not to make unemployment itself the crucial election issue. National did not want to, and was heartily relieved when Labour chose to fight the election on an issue of National’s

choosing rather than one of its own. 7. • ..,. ; With the value of hindsight, this can be seen to have affected Labour’s chances bf winning. That is not to say that if it had made unemployment its crucial issue it would, have, won, but it is a traditional Labour issue and not for 40 years has Labour had a better ' chance of capitalising on ,it. Labour did not ignore unemployment as an election issue, but it has suffered ' from not

promoting it enough. -- ; There were some candidates who concentrated on it in their .own electorates. In the marginal seat of Miramar in Wellington, for example, the Labour candidate, Mr P. C. Neilson, unseated a popular and entrenched Cabinet Minister, Mr W. L. Young, by pitching his campaign on the unem-

ployment issue. So when Mr Burke, in commenting on the January figures, says the National Government has put all the investment eggs in the “Think big” basket that even the Government will admit will bring about few jobs, he is telling the voters this three months too late. It is also sad that neither Mr Bolger’s release of the figures nor Mr Burke’s reaction to them actually have any remedies: Mr Burke says the Government actually did nothing positive to bring about badly needed jobs. Mr Bolger simply says that jobs made available to students under the community service scheme might have been at the expense of jobs for other people looking for work under other job creation programmes. Mr Burke is on sounder ground in criticising Mr Bolger for blaming students for the rise in unemployment figures. There really is not a ray of hope in Mr Bolger’s statement. He simply gives the detailed figures, criticises the students and says their holiday job programme will have to be reviewed, and leaves it at that. Yet in human terms the

scope ,of the problem and the reaction of individuals to it will have incalculable consequences. In Christchurch recently, an electrical contractor advertised a vacancy for an apprentice, and received 72 applications. Many of these were young people who had applied for positions with bigger operators, such as the . M.E.D., without success. What will be the consequences for New Zealand society of their inability, and the inability of others; to find jobs? Government job-creation programmes and special employment opportunities are not holding unemployment levels: they are only slowing the rate of growth bf unemployment. The Government's growth strategy will create some jobs, but not quickly enough and probably there will not be enough new jobs to soak up demand.

Yet the Government knows the consequences of unemployment. They were set out and explained in the report of the Adams Committee, the working party set up by the National • Research Advisory Council to look at unemployment, whose figures the Government dismissed as “garbage" and whose recommendations have been ignored. It said:—

• Unemployment is wasteful — in that human resources that could be used for the nation's good remain dorrhant. • Unemployment is costly — in that there are the direct costs of supporting unemployed people, the indirect costs of running the support system, and consequential costs resulting from a related increase in ill-health, psychological disturbance, delinquency, crime and social unrest.

• Unemployment is economically hazardous for the country as a whole. While the existence of a pool of unemployed people may allow individual employers more choice, the cost of unemployment can only be met out of national earnings. This means

that wealth must be redirected from the sector that earned it to the sector that did not. A point can be reached where the cost exceeds the capacity for the earning system to meet it. Furthermore, unemployment erodes worker capabilities, so that later when employment becomes available they are inadequately prepared for and experienced in the work place.

• Unemployment is unjust — in that one segment of the community (the young, women, ethnic minorities, the disabled, and people who have benefited least from the education system) suffer the consequences while the remainder of the community enjoys relative prosperity.

• Unemployment is divisive — in that it makes the differences between the “haves" and the “have nots” more stark and thus increases the likelihood of

resentment, bitterness and even sectional violence.

• Unemployment threatens New Zealand's national identity — in that it violates what was hitherto a fundamental national value, that everyone gets a “fair go" and those experiencing misfortune are helped, not handicapped further.

The Adams Report said that solving the problems of unemployment necessarily called for effective policy-making and action. But whether the policies made and actions taken will be effective depends to a considerable extent, on whether those policies and actions are realistic, rational and valid. The Government did not accept the Adams Report, preferring to publish “Jobs and People” instead, and so it is not bound by the definitions of the Adams Report. That is just as well because it has not met

the criteria set by the Adams Report for solving the problems of unemployment.

It is doubtful that the Government will accept the standards set by the Adams Report, even though unemployment is worsening. The Labour Party must now be cursing itself for not taking the unemployment issue and making it the cornerstone of its General Election platform.

The exact number of unemployed people is keenly debated; of more significance is the high level of unemployment and its slow but steady growth. The Adams Report did not suggest that solutions would be found easily, but no solutions which match the criteria set by the Adams Committee have yet been found. And so high and growing levels of unemployment become the probable scenario for 1982 and beyond.